HKU space taxation assignment 2???

Question
Mr Lam is planning to acquire the whole shareholdings of Cheerful Ltd. from Mr Au Yeung. During the process of negotiation, Mr Lam is given the Following:
(1) Cheerful Lrd has recently sold a property located in HK with a profit of $1M. Such property was acquired ten years ago and had been used as directors' quarter before sale. Such profit to be reported in 2006/2007.

(2) Cheerful Ltd has overlooked to claim entertainment expenses in the year of assessment 2004/2004 and the assessment has become final & conclusive.

Requied
(A) State the actions, which Mr Lam are required to take so as to protect his interest in respect of (1) & (2)

(b) From tax perspective, state the points, which Mr Lam is required to pay attention.